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Japanese yen bulls saw almost nothing but green this week as Coronavirus fears had global traders fleeing to safe haven assets.
Japanese Headlines and Economic data
Monday:
- Major global risk-off sentiment to start off the week after the mayor of Wuhan, epicenter of coronavirus outbreak, says 5 million people left the city before travel restrictions were imposed. This was likely the catalyst for the opening spike higher in the yen.
- Risk aversion sentiment grows as China confirms 2,700 cases of virus, 40 counted elsewhere.
Tuesday:
- Bank of Japan Core CPI: +0.3% y/y in Dec. 2019 vs. +0.2% y/y in Nov. 2019
- Japan Services PPI +2.1% y/y as expected
- Kuroda says BOJ’s policy not aimed at bankrolling public debt
- Japan government nominates reflationist-minded economist to join BOJ board
Wednesday:
- Japanese consumer confidence index unchanged at 39.1 from previous month, below 39.6 forecast
- BOJ Summary of Opinions: ECB and Fed policymakers reviewing policy approach to avoid “Japanification”
- Risk aversion behavior picked up quickly on the session, once again on Coronavirus fears as there was nearly 1,500 new cases in a few days and the death toll rose to 132.
Thursday:
- Russia closes China border as outbreak tops 7,900 cases with 170 deaths
- Coronavirus declared global health emergency by WHO
Friday:
- Tokyo core CPI slipped from 0.8% to 0.7%
- Japanese unemployment rate steady at 2.2% vs. 2.3% consensus
- Japan’s preliminary industrial production rebounded by 1.3% vs. 0.7% forecast
- Japanese retail sales down 2.6% y/y vs. projected 1.7% slump
- Japan Housing starts -7.9% vs. -12.7% previous
- Risk aversion accelerates once again during the Friday session as the US raises travel warning, Singapore bans Chinese travelers as outbreak spreads. Also, the U.S. declares coronavirus a public health emergency.
